Note: This review is for the SEGA CD game. There is a different game of the exact same title for the Sega Saturn. Please click here to see that review.
There are only a handful of games that come to mind when I think of Sega CD horror games: Bram Stoker's Dracula, Frankenstein, and Night Trap (heh heh) for instance. Decent games, but nothing revolutionary. (Frankenstein actually is quite good).
The Mansion of Hidden Souls, however, introduced a type of horror gaming that would become popular, although short-lived. It's the first-person point-and-click adventure, where you move your character from clickpoint to clickpoint, unable to change the motion sequences between clicks. Once at a clickpoint, you can turn your character any which way and investigate or manipulate nearby objects. It's a simple formula, and not entirely original (think of Uninvited for the NES). But we're talking 3D now! The Mansion of Hidden Souls brought you into a three-dimensional mansion with music and with real voice tracks. And it did this in 1993, two years before Clock Tower reached Super Famicom in Japan and three years before Resident Evil came to be. Exploring a haunted mansion is certainly nothing new to horror games; just look at Alone in the Dark (1992), Uninvited (1991), and Maniac Mansion (1990), just to name a few. But this style of gameplay had yet to be explored in pre-rendered 3D. So this game brought something new to the table in the early days of horror gaming, and its graphical influence can clearly be seen in Resident Evil.
The story is simple and involves your sister, who wanders into a haunted mansion because she wants to be a butterfly. The human ghosts trapped in the mansion have all become butterflies, and you must do what you can to stop your sister from becoming one too. You will explore and pick up items in various rooms, collecting hints from various characters, until you reach the hidden chambers of the mansion. The story wraps up very nicely in under 5 hours and there are only a few ways to actually kill yourself. Difficulty is not an issue. And if you were pressed to put this game into a genre, you might say it's a PG-13 "horror" game, more or less. It suffers graphically by today's standards, but I'm sure back in the day, this game was cutting edge.
You may have a sense of familiarity in the mansion (the foyer, mostly), because it looks eerily like the iconic mansion in the first Resident Evil, although, as noted above, this game is several years older. It took me a while to recognize the similarity, but it's there. I don't know if this is coincidence or something else, but I would bet money the RE designers played through this game (which, like Biohazard, is originally Japanese). The Mansion of Hidden Souls even comes complete with the tick-tocking grandfather clock in the main room, which is infamously familiar to RE fans. This would all make for interesting game history, but as far as I know, it's just conjecture. After all, plenty of Japanese games take place in yakata or "Western-style manors" and a lot of them have the same basic layout. Still, it is interesting to see it there in 1993.